SocialismToday           Socialist Party magazine

Socialism Today 156 - March 2012

Outsourcing environmental destruction

PLANS TO develop an opencast coal mine in Bangladesh expose the workings of multi-national corporations and powerful western states in their drive to control the world’s natural resources. The mining project, in Phulbari, northwest Bangladesh, threatens a human and environmental catastrophe. It will siphon off millions of dollars in profits to London-based Global Coal Management Resources Plc (GCM).

GCM’s plans, however, have been stalled for the time being by massive resistance from the people living in Phulbari – and their supporters throughout Bangladesh and internationally. GCM’s previous incarnation, Asia Energy Corporation, was stopped in its tracks in 2006 by mass protests. Tragically, these culminated in the deaths of three protesters, including a 14-year-old boy, and up to 200 injured at the hands of security forces, on 26 August 2006. The goverment has deployed the notorious Rapid Action Battalion, the subject of investigations by Human Rights Watch and Amnesty International into extrajudicial killings and the routine use of torture.

Even a committee set up by the Bangladesh government to assess the project concluded that there is "a high risk of social unrest and conflict" if GCM attempts to forcibly evict tens of thousands of people. (Summary of Expert Committee Report, Government of Bangladesh, 2006)

Since the protests in 2006, Asia Energy/GCM has not been staffing its offices in Phulbari, giving the lie to the company’s claim that its mining project enjoys popular support. In spite of this retreat, however, GCM is hellbent on pushing through its plans. A visit to its website makes it absolutely clear that the Phulbari mine remains its primary objective.

The potential gains for the company are huge. An estimated 572 million tons of high-grade, low-sulphur coal are there to be extracted over the course of 36 years. Terms of the deal include a nine-year tax holiday for GCM, after which it will be expected to pay a paltry 6% sales royalty. It is a graphic illustration of relations between western companies and states, and the neo-colonial world. An economic stranglehold is maintained, even where there is no longer direct colonial rule. Apart from a handful of top politicians and big businessmen, there will be no gain for the people of Bangladesh.

Worse than that, the development of the Phulbari mine project will have far-reaching devastating consequences. Bangladesh’s Indigenous Union (Jatiya Adivasi Parishad) estimates that 50,000 people would be displaced or impoverished by the project. At its annual general meeting in London on 15 December last year, GCM chief executive, Steve Bywater, said that cash payments would be available – although he added that the company does not want people to take the offer up! He said that most people in the area are squatters and do not own their land, giving the distinct impression that they would not even be offered the compensation. Although better than nothing, of course, cash payments are totally inadequate in such a situation. Without land, secure accommodation and a stable means of earning a living, the cash eventually disappears, used up in day-to-day survival. Impoverishment inevitably follows.

Despite its claims to the contrary, GCM has consistently failed to liaise with local communities in any meaningful way. Any talk of consultation is merely window-dressing, ticking the boxes to formally comply with ‘international standards’ and ‘corporate responsibility’ which mean nothing on the ground. It has been reported that company employees have tried to use attendance signatures at ‘consultation’ meetings as evidence of consent for mining. (For a full report of the GCM AGM and protest: GCM Challenged to Pull Out of Phulbari Project, London Mining Network, 17 December 2011)

The coalmine project would destroy nearly 12,000 acres of some of the most fertile agricultural land in Bangladesh. Capable of producing two, even three, crops a year, this region serves as the country’s rice bowl. Its height above sea level means that Phulbari is also afforded some protection from the annual flooding that regularly wipes out crops across Bangladesh. Such catastrophic extreme weather events are projected to increase, and sea levels rise, as global warming increases.

The effects on low-lying, densely-populated and impoverished states, such as Bangladesh, will be devastating. The development of the Phulbari opencast mine will not only render Bangladesh more vulnerable to these effects but will also contribute to quickening the pace of global warming through the burning of fossil fuel – it’s a lose-lose situation. Meanwhile, the cash will flow into the coffers of the British-based company, profiting directly from the environmental destruction locally in Phulbari and also globally.

The coal deposits lie 150-160 metres below ground. To maintain dry conditions in the mines, pumps would need to drain up to 800 million litres of water each day. This will lower the water table by 15-25 metres in the surrounding area, affecting more than 190 square miles, and threatening to deprive 200,000 people of their access to an adequate water supply – in an area where nearly half of all people do not have enough water to meet their needs. (Expert Committee Report, 2006)

Building the infrastructure required by the project poses a great threat to the Sandarbans, the largest mangrove in the world – under the nominal protection of Unesco. Not only does this vast forest absorb carbon from the atmosphere – thus mitigating the effects of global warming driven by carbon emissions – it also provides a buffer against devastation wrought by the tropical storms and cyclones prevalent in this part of the world. The use of large barges to transport the coal means that the risk of fuel pollution of the mangroves is also very high.

The people of Bangladesh are among the poorest in the world – nearly half survived below the nutrition poverty line last year, according to the World Food Programme. Yet the terms agreed with GCM, and similar government subsidies to big business, are adding to the onerous burden shouldered by the working class and poor. Taxes are increasing. At the same time, the government is hiking up the price of fuel, gas and electricity. The consequent rise in the cost of production and transportation has increased the price of all commodities. The cost of living and poverty levels are rising remorselessly.

Corruption dominates economic and political life. Since flag independence in 1971, power has swung periodically from military rule and the two main parties – the Awami League and Bangladesh National Party – yet little has really changed for the vast majority of the population. The mainstream political parties are in thrall to the multi-national corporations – and the major powers in which they are based – and their local middlemen.

Nonetheless, on 14 January, prime minister Sheikh Hasina Wajed of the Awami League seemed to distance herself from the Phulbari project in a speech at the convention of the Institute of Engineers of Bangladesh. Hasina said she was against extracting coal in Phulbari in the face of mass resistance, and that coal for electricity production would be imported. It was not widely reported in the media, however. And her speech was vague on details and has been met with justifiable scepticism; a politician seeking to boost her popularity. Clearly, it has been the pressure of the campaign against the mine project which forced Hasina to make this statement.

Yet, just a few days later, Alamgir Kabir, chairman of the Bangladesh Power Development Board, called for tenders for new coal-fired power stations. On 18 January, he said that they would burn imported coal, initially, but that "local coal will be utilised once the country starts extracting local coal significantly". (Bangladesh Prepares International Tenders for Four Coal-Fired Power Plants, International Business Times website, Australia, 18 January)

Tellingly, this statement was greeted by GCM investors as meaning that the use of imported coal was part of a political strategy for putting the infrastructure in place. Then, once the power plants are built, coal would be mined in Bangladesh, giving the green light to the Phulbari project. So, the struggle continues. And it will as long as such important natural resources and strategic infrastructure remain in private hands – with decision-making in the boardrooms of multinationals and behind the closed doors of cabinet meetings.

Manny Thain


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